A decision by federal regulators has yet to be made on the request of a dozen utilities, including two that serve thousands of Oklahomans, to be able to build new transmission projects in Midwestern power grids and do so without competitive bidding.
But when the Federal Energy Regulatory Commission makes a decision, it will have to consider the request of 56 state legislators from Iowa, Kansas, Montana, Missouri and Wisconsin, who are opposed to what the utilities want.
The utilities seek a five-year moratorium on transmission competition in the Southwest Power Pool (SPP) and the Midcontinent Independent System Operator (MISO).
In letters to FERC, the dozen legislators said state leaders will not allow incumbent utilities to go around their backs to prevent competition to increase their profits and increase electric rates on captive customers. The legislators filed their letters in May before the end of a protest period set by the federal agency on the request of the utilities.
The complaint, filed in April by nine incumbent utilities, would prevent utilities from having to compete to build new transmission projects in SPP and MISO for five years, raising electricity prices across 19 states.
The electric utilities that filed the complaint include Oklahoma Gas & Electric, the largest power provider in Oklahoma with 915,000 customers in a 30,000 squaremile area containing 1.6 million residents; and Empire District Electric Co., which is based in Joplin, Missouri, and serves southwest Missouri, southeast Kansas, and approximately 4,800 customers in northeastern Oklahoma.
Other power companies joining the complaint include International Transmission Co; Michigan Electric Transmission Co; ITC Midwest; ITC Great Plains; Ameren Services; American Transmission Co; Cleco Power LLC; Entergy; Evergy Inc.; and Xcel Energy.
The legislators contend that without competition, a monopoly electric utility has zero incentive to reduce costs. The more they spend, the more profit they make. The state letters stress that FERC should reject the complaint and enforce Order 1000, a federal policy that requires utilities to compete with one another to build new transmission lines, ensuring fair costs for consumers.
The utilities formed the “Grid Acceleration Coalition” and filed their bid with FERC. If FERC gives the go-ahead on the non-competition effort, it would make the utilities the default developers for any large multi-state transmission projects.
The legislators are supported by the Electricity Transmission Coalition, where Paul Cicio is chasirman and issued a statement in April.
“Over the last two months, state legislatures have shown up to protect their constituents from rising electricity prices and monopolistic anti- competitive practices. Now the decision rests at the FERC. Will FERC side with American consumers to protect competition, or will they cave to utility interest and allow for incumbent utilities to increase prices?”
However, as the Missouri Independent reported, the utilities contend that delays caused by competitive bidding is hurting progress that is desperately needed.
“To meet spiking load growth, we must build the transmission needed to connect new large loads and generation. If we succeed, we will win the race to achieve dominance in artificial intelligence (‘AI’), rebuild our nation’s manufacturing base, and ensure we have the infrastructure needed to extract our nation’s oil and gas resources,” the utilities stated in their request to FERC.
Davis Strobridge is director of regulatory strategy for ITC, one of the largest transmission companies in the country. He said it can take 16 to 20 months to select a company to build a largescale power line.
“We need rules and regulations that do things quickly and don’t have red tape involved, and removing this solicitation requirement would absolutely do that,” Strobridge said.